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Working time regulation, unequal lifetimes and fairness

Author

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  • LEROUX Marie-Louise

    (UQAM, CIRPEE, CORE and CESifo)

  • PONTHIERE Gregory

    (Université Paris Est, Paris School of Ecoomics and Institut Universitaire de France)

Abstract

We examine the redistributive impact of working time regulations in an economy with unequal lifetimes. It is shown that uniform working time reductions, when uncompensated (i.e. constant hourly wage), can reduce inequalities in realized lifetime well-being between short-lived and long-lived persons with respect to the laissez-faire but at the cost of making the short-lived worse off. When compensated (i.e. constant labour earnings), uniform working time reductions make the short-lived better off, but at the cost of raising inequalities between short-lived and long-lived. Then, we characterize the ex post egalitarian optimum, where the realized lifetime well-being of the worst off is maximized, and show that this social optimum involves an increasing age profile in terms of worked hours. We examine the decentralization of that social optimum, and we provide a second-best egalitarian argument for age-dependent working time regulation, which can make the short-lived better off and reduce inequalities in realized lifetime well-being.

Suggested Citation

  • LEROUX Marie-Louise & PONTHIERE Gregory, 2017. "Working time regulation, unequal lifetimes and fairness," LIDAM Discussion Papers CORE 2017003, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    • Handle: RePEc:cor:louvco:2017003
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    Cited by:

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    2. Marie-Louise Leroux & Pierre Pestieau & Gregory Ponthiere, 2021. "Fair long-term care insurance," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 57(3), pages 503-533, October.
    3. Bastani, Spencer & Giebe, Thomas & Guertler, Oliver, 2024. "Overconfidence and gender gaps in career outcomes: insights from a promotion signaling model," Working Paper Series 2024:21, IFAU - Institute for Evaluation of Labour Market and Education Policy.
    4. Gregory Ponthiere, 2020. "A theory of reverse retirement," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 22(5), pages 1618-1659, September.
    5. Shiyu Li & Shuanglin Lin, 2024. "Social security reforms, capital accumulation, and welfare: A notional defined contribution system vs a modified PAYG system," Journal of Population Economics, Springer;European Society for Population Economics, vol. 37(1), pages 1-34, March.
    6. Gregory Ponthiere, 2025. "Social insurance against a short life: Ante-Mortem versus post-mortem policies," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 65(1), pages 255-290, August.
    7. Ponthiere, Gregory, 2024. "Stoicism and the Value of Life," GLO Discussion Paper Series 1545, Global Labor Organization (GLO).

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    Keywords

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    JEL classification:

    • J10 - Labor and Demographic Economics - - Demographic Economics - - - General
    • J18 - Labor and Demographic Economics - - Demographic Economics - - - Public Policy
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply

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